tv Power Lunch CNBC November 10, 2016 1:00pm-3:01pm EST
their prognostication going forward is that growth is picking up. consumption is at 17% gdp. that would be very positive for the u.s. company. >> the srt, which we're talking about hehere. >> no doubt. good stuff. thanks for watching. "power lunch" begins now. >> welcome to "power lunch." here's what's on the rally. you've got financials flying while technology tanks. we're going to find out why and why you should be investing in this new political world. plus donald trump says he's pro oil, but does that make oil stocks an automatic buy or maybe an automatic sell? hmm. listen up all you homeowners and buyers. right now could be the last chance to lock in the low mortgage rates, so sign the check. a busy "power lunch" starts right now.
>> welcome to "power lunch." i'm mischelle caruso cabrera. the s&p 500 pretty much flat while the nasdaq composite is in negative territory. a lot of the high flyers, the ones with big dividends, they tend to be getting hit today. why? take a look at the tenure. we continue to see interest rates riechltz the yield curve is steepening. that's what's happening with the ten-year note. it's almost 2.1%. also catching a lot of comment today is the price of copper. look at the big move that this has made. this is a two-day chart. we show you this. it suggests people are excited about growth. tyler. >> thank you very much, michelle. i'm tyler mathisen. this is my microphone. here's what else is happening this hour. president obama and president-elect donald trump
talked. they wrapped it up now talking foreign policy. video gaming falling in the third quarter. and tesla unveiling the price for its self-driving feature. it plans to charge buyers of its newest cars $8,000 to activate autonomous driving technology. melissa. >> welcome, everybody. i'm melissa lee. two big things happening now. financials flying, techs tanking. let's drill down on one of them. check out shares of amazon. those shares are down by 4.5%. just today jeff bezos extending an olive branch to donald trump tweeting, congratulations to donald trump. i for one give him my most open mind and wish him great success in his service to the country. you might remember on the campaign trail donald trump raised anti-trust concerns with amazon.
john, now that trump is president-elect, does this factor into any concern about amazon? >> for us, not at all. i know the stock's down about 8% or 9% the last two trading days after being up 17% year to date. but the fundamentals of the company are very strong. they recently reported we're seeing accelerated growth in prime members, accelerating growth in units sold, and they're putting on 23 fulfillment centers in place in the last four months. that's more than they've ever done in any other year in their history, and that's because they have great demand on the e-commerce side and things at ews are going well. >> i want to put aside the an - anti-trust issue because that's of bigger concern but what mr. trump has been touting on the campaign trail when it comes to taxes, amazon, correct me if i'm
wrong, has about a third of its footprint outside the united states, is that correct? >> that's correct. >> a third of its retail sales are coming from outside the united states. if we're going to move to a more protectionist country, isn't that going to cause something? >> if for some reason it had an impact on its selection for customers, yeah, we'll have to see -- we'll have to see how that goes. but, yeah, it's something that we'll look at and think about in the coming months. >> so it is a question mark in your model at this point as to whether or not amazon will be able to continue the way it does its business at the cost of doing its fwiz now. >> yeah. i think it will be fine. you know, i don't see any disruption in their business. they are crushing it on the
e-commerce side both domestically and internationally. like i say, the grouktd in the prime customers has been great, the growth in their units, and their e-commerce business accelerated over the past year, so i don't think it will be disruptive. >> excuse me. what about if it's just the victim of higher interest rates? what if higher interest rates are going to compress multiples, take the wind out of the sales of anything that's a high flyer? could it be that simple? no matter what they do, when the trade-off is, i can actually get higher yields somewhere else? >> potentially what i've seen the last couple of days what you guys have mentioned, earlier today, a rotation to financials, a rotation to industrials, and, you know, amazon, the sentiment is still very strong for the company, so it would be as simple as that. we look at this as a buying opportunity. i mean right now the stock's trading at 15 times next year's
ebitda. this is for a company, like i said, that's sign accelerating e-commerce growth doing a billion dollars in revenue with huge consumer demands. we remain super bullish on amazon and think this is just, you know, a blip in the road. >> what if mr. bezos just sends him him alexa and asks him? >> we think there's a million echo devices in the u.s. sold and a ton more sold this hollywood season, so i'm sure maybe they could outfit the white house. >> i think you're right. i think echo is going to be the hot seller this season. >> it's very cool. >> i don't think secret service will like alex vice will like alexa will like alexlexa, but that's t my opinion. >> all those microphones. >> i know. not a good idea.
>> not a good idea for anybody's house. >> i agree with that. >> all the time? it's surrounded by mikes. >> exactly. >> let's turn now to the big rally in the financials. the flx is up 2%, 8% this week alone. higher rates, less regulation. big bank ceo jamie dimon becoming the next treasury secretary. are the stars aligning for the financials? on the newsline, good to have you here, anton. it seems pretty obvious. higher interest rates, potentially less regulation. what does that mean, drilled down to the possibility that dodd/frank goes away or gets altered dramatically? >> well, i'lled a one more. potentially stronger economic growth. tlp's a lot of trapped capital
with bigger penalties. they're about to come out of the penalty box. higher dividends, higher buybacks and more capital out there to help stimulate the economy. it's been tight to get, you know, loans on the big banking side. it clearly has been a tough economy. we've grown very slowly. so with some infrastructure spending, a steeper yield curve, potentially more fed hikes, they're in the sweet spot right now. >> anton, i've got a screen with over 100 regional mid sized banks, they're 20% and 30% higher. two questions. how much money has your fund made in the last 90 days and are you selling some of these names which have been red, red hot? >> sure. i still feel very good about the upside for the space.
i always love having dry powder, so when i bought something two weeks ago and it's up 15%, i'm going to take a little off the table. >> such as? >> i never talk about anything short term. when markets run like this, you know, you have to take some off the table. from a portfolio perspective, i continue to put new money in work in other names. some m & a has stalled because there's gap between the buyer and the seller. well, guess what happens? the buyer's stock price is up and they can meet the price of the searl. i think we're going to see more transactions happen. obviously banks that are trapped and in distress, you know, will be able to demand a higher price because the buyers have a higher stock price to pay. if you think about the ability to raise capital for banks that need capital, again, it's there. prices will be there.
>> so anton, if you could walk us through the various catalysts and the timing of them because obviously a repeal of dodd/frank may or may not happen, but if it does happen, that would happen down the road. immediately is it rising rates, increased training activity? what are the very near term catalysts right now? >> sure. i'd say that the december rate hike certainly, you know, for a few minutes in the middle of the night on election night, you know, dropped dramatically and have risen back up again. people talk about more rate hikes because of the fiscal stimulus. rate hikes, that's december, not too far away. clearly the trading activity has been huge, so that's there. i'd say in a stronger market environment you can, you know, raise capital. you can do ipos. i think you had an an analyst on earlier. i expect them to do more health care deals. they're very well known for that. i think it's a good environment
for the capital markets near term, so i think you're going to see estimates rising. i think the yield curve getting steeper. it's something that happens and stays there. you don't snap your finger and it gets better, but clearly there's an upside. >> every name they make would become more profitable the wider that margin gets. anton, thanks so much. appreciate it. we've got a news alert. bond markets are up. let's get to rick santelli. rick? >> hi, tyler, yes. it was 15 million year bonds. the yield, 2.902. i saw the top of the one issue at 290. we were in the 289 bid side. so priced on the high side of wbi, that's never a good thing. it was the highest price -- yield, excuse me, at a dutch auction since january of 2015,
which is the last time we saw markets close on the long end. let's go through the internals. i gave it a "d" as in dog, by the way. there wasn't any bright spots. 2.11 to cover. that was since february 2015. and then redirected since august of 2015. the one bright spot that kept it from the d-minus of yesterday's tenure, that's the best since october of 2015. listen. these auctions need a roger maris asterisks. of course, invests are very cognizant of that. tyler, back to you. >> thank you very much. news that president-elect trump and mike pence are getting ready to speak with the house speaker, mr. ryan. you see the automobiles lining up. i can't tell where that is. if assume at the capitol.
that's where the meet willing take place. meanwhile, deal/no deal, donald trump will block the at&t/time warner merger. up next, you'll hear from the charter communications ceo. or stop to find a bathroom? cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be ready anytime the moment is right. plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away.
rutledge. what impact do you see a trump presidency having on your business at charter? >> well, we were already making cable great again, so we continue doing that. look, you know, it could be a better regulatory environment. there's been a lot of pressure on the business because of some of the regulatory actions of the obama administration, title 2, set-top box regulation, privacy. >> broad band pricing? >> yeah. so to the extent we're in a better regulatory environment, it's good for us. >> generally speaking you do see it as a positive. would it allow you to grow more through acquisition? is that a possibility too? >> yeah. i suppose that's right. you know, i'm an optimist. i hope we have a good government. you know, having smart regulatory strategies, so i'm generally optimistic about our future and prepared to deal with
whatever comes. >> right. as you have been, of course, in the past. >> of course. >> and you did manage to get a huge deal through -- >> i did. >> -- the anti-trust authorities and s.e.c. and now charter and time warner are all one, rebranding into spectrum. beginning in new york in a bigger way. >> in a big way. we've done texas, we're doing new york and florida next week and we're rolling that out across the country in a sort of orderly way and we'll be done by march. the whole company will be called spectrum. we have 40,000 trucks to paint, 700 buildings, lots of uniforms. but we're in market with our new name. >> video subs continue to rise at your new company which is a surprise who see the universe of people who are willing to take video with broadband falling, which it is. the unbundling we talk about.
>> right. >> do you see that continuing be the case? 35 bucks for 100 channels? do you see that where people say i don't need the video anymore? >> some people call that cord cutting. we hooked up 1.3 million cords last year. some of those are broadband. some of those are video. and so we think there is a group of people who will buy over-the-top programming and limited services. it looks to me like the directv is a niche auvgs not full service. >> why is that? >> there's no broadcasting. most want that service as part of the package. so i think there is an audience for it. but i think most people like the package we have. one of the problems with our packaging is the pricing is high. and the reason the pricing is high is because there's so much content in it and it's putting stress on a lot of consumers,
but people would rather have it. you know, the single best response we get from any marketplace that we offer that we sell to is the noncorded marketplace, meaning people who don't have cable but have broadband have the highest response to any marketing that we produce. so if i drop a direct mail piece or television ad, the biggest response i get are from people who are broadband only and buying video. the reason is because that's the most price-sensitive marketplace. they want the products, but they're price-sensitive. >> right. finally, tom, i spoke with john malone earlier. one of which you raise is the idea that wireless and distribution of the likes of which you offer have to come in closer today.
it won't really start taking place until 2017. is that enough or do you need owner economics when it comes to wireless? >> i think in the long run we're moving toward that. today we have 22 million wireless connections in homes and 200 million devices attached. in ma ways we are a wireless company. we're not a mobile company. i see us building out 5g wireless in the long run, inside out from the home to the business, out on the street where products will be delivered at very high capacity and low latency and virtual reality, augmented reality. so i see we're a future where we're a facilities-based wireless as well where some think of us as a wired company.
>> brief time but thanks for bug with us. back to you. >> thanks for bringing that us to. dom chu with a market update. >> fitbit says, quote, it has not receive ned communications from abm capital or any firm regarding a reported offer. we remain focused on delivering innovative products. consumers love and are confident in our vision for the future. this is because earlier today fitbit shares spiked on a regulatory filing that was made at least by a company called abm capit capital. upon some further investigation it didn't appear there was any legitimacy to the filing. it was said to be a company based out of asia and shanghai. the phone number didn't work. the shares did go volatilely but
fitbit says it did not receive a tender. we also reached out to the fcc and they declined to comment. >> this happened every now and then. very weird. thanks for brinks that to us. did the fed riri silver help put donald trump in the white house. one billionaire investor says, of course. that story next.
zwried monetary policy help get donald trump elected? >> of course, it did. it was a small part of it, but, of course, it did. >> that was a conversation earlier with duquesne capital founder stanley druckenmiller. steve liesman is here. >> i went back over my notes and googled has the federal reserve hurt savers. a whole lot of things come up. then i asked if it helped borrowe borrowers, and nothing came up. there are two sides. the federal reserve has hurt those who are savers by lowering interest rates and it's helped buyers. when you transfer money, a saver is less likely to spend an extra
dollar. so there's all kinds of ways that it helps borrowers. for example through the auto loan market. people take loans out through the economy. now, the idea -- first of all, arguing with stan who's a brilliant man, something who i have gotten to know and have high respect for, i think the conversation has been one-sided. let me point out two other facts. when i looked at the exit polls to try to see that 65 and older vote for donald trump in greater numbers, the answer is no. second, when i look at what donald trump said, he believed that low interest rates hurt his candy da sichlt he said the fed is keeping rates low to help president obama. >> to help hillary clinton. >> yep, yep. >> i think part of it was to create asset bubbles.
all goes up so the perception of wealth gets much, much higher. >> that's an interesting point. there are ways, for example, it's helped wealthier much more than it's helped others. >> and borrowing who were helped, borrowers are people who have some means and assets, particularly where banks are being careful upon whom they approve for credit. >> it's a 15-year experience to know that tyler would put his finger right on the button as usual, which is the idea that the help for borrowers has been badly attenuated with the banking. they would have helped borrowers a lot more if standards hasn't gone up. they may not have felt the effects of low interest rates as much as they should have. >> thank you, steve. >> two parts to the story. maybe we reached the point where
we help borrowers as much as we can. >> thank you, steve. coming up forecast you're thinking of buying a home or refinancing your mortgage, right now could be a very big moment for you. we'll tell you why mortgage rates are making the biggest loans in years. that story straight ahead. important than your health. or the freedom to choose what doctor you want to see. so if you have medicare parts a and b, consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans,
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i'm courtney reagan and here's your cnbc news update at this hour. president obama meeting with president-elect donald trump at the white house for more than an hour. the president said they had an excellent and wide-ranging conversation. >> we talked about some of the organizational issues in setting up the white house, foreign policy, domestic policy, my number one priority in the coming two months is to try to facilitate a transition that ensures our president-elect is successful. >> volvo is recalling vehicles. it involves the passenger
sbaelt. it involves 2016 and 2017 years. team executives brought the world series trophy and "w" flag with them as they rang the opening bell at the new york stock exchange. coincidentally or not, the dow happened to hit a record high. now back over to you. brian, it has been a pretty big year or couple of months if you think about it. back to you. >> it really has. i'm ready for the year to be over. thank you very much. the week isn't oven and your money has seen huge moves. it's on track for its best week of the year. bonds have also sold off. the treasury yield up 17% in more than two days. yields of the 30-year bond near a ten-month high. let's get some advice in this post-election world and welcome in a chief invest meant officer of u.s. core strategies. scott, how much of a move have we seen in bonds in commodities and equities have been directly
related to the election? >> most of it. that's our view. certainly the last few days, it's a reassessment, we think, of investors looking at potential changes in monetary policy, in the growth trajectory and in inflation. that's what's driven financial prices in the last few days. >> how much are you shifting then, scott? >> we think it's important to consider that the markets are very likely to swing back and forth between worries about the change. change is a monumental shift but there's a downside. right now investors seem to be focused on the potential for growth to be high eric inflation to be higher, and they're not focused on any of the downside risks which are uncertainty, which might hold back economic activity. there's so much we don't know. right now they seem to be not too concerned about trade,
changes in trading relationships and the dregs that that might create. a lot of uncertainty there. so we think investors are probably going to be continuously moving back and forth between focus on the downside or upside. we think much of the shift in terms of valuations is already behind us. >> you've about got a long-term view, scott. compared to 48 hours ago do, you view this market more as a risk-on market? >> it is for the time being. of course, if you look at the developments, what's actually happened, what's happened so far would slow economic growth. massive amount of uncertainty. you see that when you look at business surveys, tighter financial conditions because the equity prices are up a bit. we had a massive change in borrowing rates and we've had an increase in the dollar. if you looked at that in
isolation, you would say, that's a negative going forward. we think it's very important to not get too caught up in the rhetoric here and to continuously analyze where you are in terms of your portfolio positioning. as we see new appointments, changes in policy, that's really going to swing markets around. one thing we can be sure of is it's going to be more than in the past few years. >> i'm curious, scott. rewind the tape from monday afternoon. what personally did you think in your heart of hearts -- i don't know the answer to this because i don't know what you were thinking on monday. what did you think was going to happen to the markets if mr. trump won on wednesday? did they react the way you thought they would? >> not exactly. we, of course, we spent a lot of time on the analysis and had swurn assigned to that event. we found in the event of a
republican sweep there would likely be a period of uncertainty which might dwarf some of the more positive changes that could happen with respect to economic activity. so, you know, it turns out the market romanced that for all of about six to eight hours. we'd always forecast there would be this period that might hurt financial asset prices in general. most dwould poorly but there would be a period where bonds would do quite well because they're powered by the risk-off element. >> okay. >> we don't think we're through that period. >> we're two days in. the game is early. scott, thank you very much. scott mather of pimco. >> thank you. big moves on the bond market certainly impacting mortgage rates. your window to lock in a low rate may, in fact, be closing. diana olick has that story.
>> it may be shut for some folks. we haven't seen a jump like this since the taper tantrum three years ago. take a look. it moved 25 basis points in two days or a quarter of a percentage point from 2.365 to 2.875. i'd be paying about 30 bucks a month more today. that might not sound like a lot, but remember as rates rise, it gets harder to qualify based on debt to income limit. if you wanted to get the same rate as tuesday, you'd have to put in $4,000 up front cost. this is all happening because of the selloff. it took off yesterday, crossing the 2% line. last time was three years ago when the fed said they would be tapering their investment in the bond market we saw a move of a
half a percent. we should note the rise in interstate is hitting a high in reits. the general jump in the markets are a positive. back to you guys. >> thank you very much, diana. president-elect trump and vice president elect pence meeting with the house speaker at this hour. after that they're going go across the capitol to see the senate majority leader mitch mcconnell. we'll keep your eyes on that. >> donald trump has vowed to appeal and replace obamacare. what will health insurance look like in a trump economy? and maybe in the running to join trump's cabinet. he's currently running florida at the moment. governor rick scott next on "power lunch." your insurance company
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vepd. president-elect trump and vice president-elect pence will be meeting with mitch o'connell. let's bring in florida's governor rick scott. governor scott, welcome to have you with us. >> it's pretty exciting. i met with the president. i'm really excited. finally i have a partner in the white house who is going to focus on jobs, which i have done for six years. >> you yourself were an outsider who took on the establishment of the state of florida to become governor. you're a business owner in the health care field. more on that in a minute. how do you think president trump should proceed with the remaking of washington? >> we should focus on the number one issue and that's job creation. he's got to focus on how can we make sure companies focus on it. if we do that, that's lower
taxes, more regulation, make sure it's an environment where people want to build their companies here. once you do that, which is what i did after i got elected here, then you have money to do other things. we added 1,200,000 jobs, streamlining everything we can, getting rid of fees so companies know there's consistency here and then recruiting companies to expand. >> governor, the republicans think one way to do it is to modify, repeal, do something related to obamacare. i assume you want to repeal -- remember the battles the florida had with the federal government. what would be a better fix in order to increase competition and therefore lower prices? >> you're right. the most important thing we can do is we've got to lower prices. the way you do that, you do it like you do in other centers. competition, reward people for
taking care of themselves. remember, we still want everybody to have the opportunity to get the health care they need. the way to do it is lower cost and lower the safety net for the people that need help. maybe they can afford to do more of it on their own. >> governor, you got rich building up hospitals, combining hospitals. is the biggest problem the insurance side or the hospital side and the treatment side? >> it's the government's side. the government doesn't need -- government involvement in health care is ridiculous. all it does is reduce competition, doesn't let you buy the insurance you want to buy. it makes it more difficult to compete. so we get government out of the way, the private sector can work. we can drive down the cost of health care. people can afford health care. >> can i follow up? i'm sorry, governor. you know as well as i do health
care was expensive before obama took office. it wasn't as if health care was a great bargain prior to 2008 which is why they started debating obamacare because it was already in trouble. >> because of government involvement. it hasn't gotten better, it's gotten way worse. it's skyrocketed because of obamacare. >> what's the hurdle to getting insurance sold across state lines? is it insurance companies? do they like that? is it the wreck laters in each of the states like their fivdom and doan want to give it up? >> it's the history. it is not something they've put a lot of effort in. it's all doable. the big thing is allow there to be competition. if you stop and think about it, we have all this new technology. let it work. let the new technology come in.
allow people to stay -- you know, allow people to build different types of hospitals. things like that. don't tell people exactly what they want to buy. let them buy what they need. we all know our bodies better than any insurance company or government. watch. they'll figure out things. if you drive down the cost, moment peeft get covered. >> the biggest way that government is involved in health care is through medicare. second biggest is medicaid. do you want to see medicare and medicaid go out of the way so they're not insured them? >> i think we need to make sure we have safety nets for those that need care. so if you can't afford health care, we've got to have a health care system for you like medicaid. and if you paid into the system like the medicare recipients have, you ought to have the
opportunity to do that. but let's look what we've done. basically everybody has to go through some sort of government involvement. we shouldn't be doing that. we should let the private sector make the decision. i want to make sure they drive it down. competition will do it. >> you were with colombia, a big hospital company. back to brian's question, how much has the lack of transparency helped raise costs in the system? in other words, i don't know -- i don't know what i'm really pay ing or i krchlt figure it out. what am i really paying. >> i've been working with legislation that requires hospitals to disclose their prices. you should know exactly what you're paying for health care. that way you can price shop.
you should price shop like you do for other things. it's not just price though. it's the quality of the service, the type of service you want, location. it's like other industries. you've got to think about all those things but give the consumer the inform snoogs i couldn't agree with you more but it's very, very hard to get information about quality of care. it's always impossible. i don't know whether one doctor is better than another. it's complimentary to be mentioned. it's been mentioned in connection with a cabinet post. would you accept a cabinet post? >> i'll do everything i can to help my good friend donald trump. i have 780 days left in this job. i want to keep this up. >> governor scott, thank you. appreciate it. >> thank you. have a great day. >> you too. all right.
president-elect donald trump and vice president elect mike pence meeting with the house speaker. after that they'll go meet with mitch mcconnell on capitol hill. melissa. >> all right, michelle. thank you. key wall street calls of the day. first stock. cfc. near-term pressures. there are cost savings versus 2016 levels and economic tail winds that will remain moderate. the analysts say the stocks run up 31% this year and he says that that makes the risk reward balanced. >> but stocks are up. i wonder if people think it's going to get a coal boost. we'll see. the second stock, medical care, human na, jp missouri began
upgrading. they boost the target. the primary drivers of the upgrade improving the company's earnings power. higher odds of a permanent repeal of certain laws and lower political risks for judges to approve the aetna deal. that's part of the trump impact right there. $202 target -- >> it will be huge. >> -- is about an 8% upside. >> not bad. expedia priceline. it goes to a buy. they were bearish at the start of the year for a number of reasons including hotels and moderating economic assets. the priceline has executed well with excel rating room growth. they've overshadowed concerns about the integration risk related to the home away deal. >> i want to keep you in
suspense. i want to take you back to washington very quickly. we'll get the small cap stock in. donald trump and mike pence, the president and vice president elect were about ready or driven out of that meeting we just showed you. apparently we didn't get an obligatory camera wave. right now we're looking at a driveway with a buchb. of cameras. when something happens we'll take you back to that. let's go back to our small cap. look. the music fires back up and we're into it. >> a little jazzy. >> it really is. it only went public in september. it's a researches shop. started by putting its stock on the focus list. it's debt-free with several big products in the pipeline for next year. they like strong cash flow on the stock. that's about 30% upside. the ticker there, nblx.
all right. we're waiting the arrival president-elect trump for meeting with mitch mcconnell, the senate majority leader. there he is now. there he is with speaker ryan. this is a live shot. meeting with speaker ryan. then we hear he is going across the capitol with mr. pence, his vice president elect to meet with mr. mcconnell. >> so much speculation about whether or not ryan would survive, right? it feels like that's been put to rest at this point. >> it does for now. it sure does. >> speaking about the transition of power and how it will affect industries, let's get to phil
lebeau and information related to the auto industry. >> michelle, not surprised you have a number of industries looking at the trump administration and thinking they might get some relief in terms of regulation lagss. the automakers are no different. in the last hour this letter has been sent to the trump transition team, basically trade group who represents a number of the automakers, and a number of things they're asking the trump transition team together as they put together their administration, a review of the fuel economy standards. just to bring you up to speed on those, remember at the beginning of the obama administration, of course york u had the auto industry basically on its back. the obama administration said, you know what? as part of the revamping of the auto industry, we're going to require much stricter fuel economy standards between now, which was ba in the 2009/2010 period and not to get wonky, it picks up over the next five to
seven years so the maker has to have a standard for all of their fleet of vehicles of 54.5 miles. to put that in perspective, it's much less, 29. it certainly will be costly and difficult for the industry. they're asking the trump administration to review those standards. by the way, there's already a mid cycle review going on. they would like them to weigh in, bring down those standards to something that is much more manageable than 54 1/2 miles. >> let's go back to washington, d.c., because i understand we have more video of what's happening there. let's listen in. >> i think we're going to look at some absolutely spectacular things for the american people. we look forward to starting.
truthfully we can't get started. whether it's health care or administration, so many things, they'll be putting things up quickly. very good meeting. very detailed meeting. that's what we want to do and that's why we're excited. >> how does it feel to be in d.c.? how does it feel to be in washington the first day as president-elect? thanks, guys. >> thank you very much, everybody. >> president-elect donald trump. >> very polite. they're having none of it. they're not answering questions. >> donald trump even restrained
himself. >> usually he'll go ahead and answer. >> it is interesting to see the body language there. mr. ryan, of course, has been a reluctant supporter to put it mildly. >> was that a sincere smile or bemused smile or i can't believe it's happening smile? >> mona lisa smile. >> it's interesting. >> inexcusable. >> these are off-the-cuff remarks. immigration, health care, and taxes off the bat. let's bring in eamon javers. eamon. >> when you look at the twosome, you look at paul ryan who's been one of the thought leaders in republican politics nationwide. now he's very much transcended by donald trump who will be the president of the united states. so the question for paul ryan, how much of his attention dovetails what donald trump wants to do. he has said quite a bit of it. there was a real reluctance on
the part of paul ryan to even campaign with donald trump toward the end. now they're mending fences and patching things up and they look like they plan on having a work relationship. i would say trump's appearance before the cameras today probably helps ryan to for stall any efforts of having him removed as speaker of the house. he's doing ryan a solid in that sense. also interesting that we're getting this sort of moving target in terms of these meetings. we were told some of it would be off campus. then we saw that they met in the capitol building. you see them walking in through the carriage entrance under the steps going into speaker ryan's office. we're told if this holds, paul ryan will be giving donald trump a look at the front steps of the capitol building where the president-elect will be sworn in in january. he'll be able to see the spot where that will take place and
get comfortable with the ins and outs of the capital building. >> he probably wants to know where the logo goes. i'm kidding, i'm kidding, i'm kidding. at various points he said he would like to see a special session of congress dedicated to solving the health care issue. are you hearing anything about that and do you assume that's one of the things they'll be talking about, mr. ryan and mr. mcconnell with the president-elect? >> no. we're not hearing anything about it. it would be early for that. you would imagine that donald trump is going to do exactly what he said he was going to do on the campaign trail and we will see how republicans handle it. >> you know what, eamon? phil lebeau was on the story about what the auto industry wants. listen to this.
elizabeth warren chiming in. we have more live pictures from the cap tachlt melania, donald trump and mike pence overlooking the steps of the capitol just like you were talking about, eamon. >> yeah. that's the west front of the capital building. we were talking about the spot where he's seen where he'll be sworn in. you see pennsylvania avenue and the distance and that tower on the left-hand side of your screen, that's the trump building where donald trump has recently reopened a brand-new very lavish hotel, so trump is overseeing what he'll see on his inauguration but some of his own properties there in downtown washington, d.c. it is a stupendous feeling. >> what a moment for donald trump, not only to be elected president but looking at one of his own buildings that he just opened up with a lot of regulatory hassle of the last
couple of years and has taken heat. by the way, eamon javers is just to the right. >> we're not too far from there. pence, an insider, he'll see that. it takes on an entirely new significance when you're talking about a presidential inaugural and all the agenda items they want to accomplish. quite a moment for donald and melania trump. i'm not sure if he's ever been there. >> he testified many, many years on capitol hill. >> on those steps, i just don't know. it's quite something to see from up there. it's one of the best views in the world. he'll have it today and on inauguration day. >> thank you. right now let's get you to the deal conference. andrew ross sorkin is deal iing
howard schultz. >> there's no doubt the rest of the country and world is in a state of shock and disbelief and i think you've got to take a step back and ask yourself how did this happen and why, and i think it's -- it's systemic. it's not baseded for me on the last year or two of a very tough campaign. i think we're looking at years and years of a great many people in america feeling as if they have not been heard, they have not been listened to, they've been let down. as a result of this, there was an outcry for change and we got it. >> and how does this align or not align -- you run a company that i thil of as a values-based company. >> yes. >> how do you think that this impacts that? >> well, starbucks now has
25,000 stores in 75 countries, and in the u.s. we basically have a store in almost every community. the business model of starbucks is about community, creating a third place, and economically trying to create a balance between profit and benevolence. that's not going to change as a result of the leadership in washington. the truth of the matter is washington has been broken for quite some time and dysfunctional and polarized, and one of the reasons why as a company we have used our palace form for social impact and social change is because we believe the rules of engagement for a company is very, very different as a result of washington not doing its job. it's the first company in america to give health
insurance. four-year drj degree. the short answer is whatever is going to happen in washington as a result of the trump administration is not going to affect how we're going to take care of our people and do the things we need to do to keep innovating. >> but do you feel like you're directly at odds with mr. trump? or president-elect trump, i should say. it reads i have one of the most successful starbucks in trump tower. >> not true. >> maybe we should boycott. surely. who cares. he goes on to say if he becomes president we're all going to be saying merry christmas. that i can tell you, of course, relates to the cups. >> yeah. you know, every now and then you
wake up and you say what? so i see this gentleman has the red cup in the front row. so for 25 consecutive years we have come out with a red cup for holiday, which pretty much has been the emblematic symbol of christmas in america. last year we had a spectacular red cup, but unfortunately we decided it should be red, nothing on it. we never had signs of christ or christmas specifically. at the time, president-elect trump decided we were anti-christmas and called for a boycott. the irony is we had our best business ever last yearnd our business went up so i thanked him. >> this could be good forbid. to me the starbucks brand has almost become iconic as an american brand. >> yeah. >> how do you -- you just got
back from china and i know you were in japan. how do you think that we are viewed and how has that changed or it u nor not? >> the way i would answer it this way. i think, unfortunately, there's been a lack of truth and authenticity in america for a while and that has affected a level of trust in government. so when you carry the american flag from the u.s. to another country, there is both a feels of pride in the american story and the american promise and then i think there's a new level of skepticism as a result of
things that have happened over recent years. and then it's up to you, i think, to try to be the kind of company that speaks truth. is value based and takes care of people. we've been in china for, that is going to be a great market for us. we've done things in china that are very un-american and very unusual. as an example, we have an annual meeting of parents of our employees in china, and we started doing that to celebrate the family. to demonstrate respect and humility because of the family and one child within the family, and so i think the question is how do you grow a global business as an american company demonstrating sincerity, humility, and a level of -- not
entitlement. that you have to earn success. i think the short answer is 22 years ago there was a lot more, i think, admiration than atlanta is today. there's much more of a burden today to prove yourself and to demonstrate truth and authenticity. >> let me ask you about being a company that prides itself on social movements, social good. you got involved in lots of dirjts issues. lots of times controversy. i think it was a year ago that you stood up and they said, why are you doing this, shouldn't you be off running a retail coffee company. >> yeah. >> focus on the business, the shareholders, leave all this
other stuff alone. >> that particular meeting, at our annual meeting we had a 38% investment to shareholders on the year and we were criticized for not doing better in support of lesbians and gay and i said if 38% is not enough, it's a free country. >> we're going leave that howard schultz interview for a moment and listen in on twha's happening. there you see misch millimeter connell to his right, mike pence to his left. see if he says anything. >> mr. trump, tell us about your tour of the balcony. >> really beautiful.
really, really beautiful, thank you. >> if you didn't hear that, the president-elect said they had a nice meeting. >> and the view was beautiful. >> he's not giving us what we want. >> subdued donald trump. >> subdued. >> almost as subdued as howard schultz who seems incredibly disappointed that donald trump was won. jack welch spoke about jamie dimon just yesterday on "power lunch." >> who among the people you know would make a gooding trekry secretary. who would be the good one? >> there are all kinds of good ones out there. >> mr. manu chi thinks --
>> die non, jamie dimon. >> would he do it? >> that's another question. >> joining us now is the aforementioned kate. wh kelly. do you think he's take it? >> the trump team has assigned him. this doesn't necessarily have to do with donald trump. it's something he said over the years he would not want to do. he suggested he had higher aspirations. >> i said publicly i'd to love be president. i'm not going to be. i'm not going to run. look at the politics. my slogan? make mesh fun again. >> that seems to be a good one.
i reached out to him. as to the person at jp missouri began, he wouldn't elaborate more than what jamie dimon has said. what i think is interesting is the signal it sechblds to the rest of us and the markets in particular about what may be in the transition minds. you guys mentioned some donald trump intimates. baker a longtime friend and have come up. >> they're all bankers, kate. elizabeth warren would be out there screaming at hillary clinton saying she would have never done anything like this.
>> you haerd rick santelli making that very point. this is the anti-staen staepd. i'm paraphrasing but i think opportunity they sig nif file it. >> do you want to d -- >> no new york. >> thought you were signaling. never mind. >> the guess is you could be part of the establishment but mr. trump knows he needs experienced mayors around him. >> that would be the indication of an idea like this. that's the question that if not top of mind. close to the top. he said so many things on the campaign trail. he possibled off and said some
ultimately offensive things about or there will be a staumt that's much morer is rye bral and maybe so. >> it's fascinating to watch. he and his family at are the white house. they go to the balcony and look out where over 170 million will be. i'm sure that the weight of the officers is coming down to but point president obama ploi. it's not just about the transfer or pofer. i think it it is tlp passionation of dufrps depz. yes, we will.
yes, we will. >> the sixpy lars hoff donald trump, oil. a big rally. take a look at that. 19,000 in oursites. power lunch is back in 2. accessible by thousands of suppliers and employees globally. but with cyber threats on the rise, mary's data could be under attack. with the help of at&t, and security that senses and mitigates cyber threats, their critical data is safer than ever. giving them the agility to be open & secure. because no one knows & like at&t. what are you doing? getting your quarter back. fountains don't earn interest, david. you know i work at ally. i was being romantic. you know what i find romantic? a robust annual percentage yield that's what i find romantic. this is literally throwing your money away.
back-to-school season was very strong. we'll have much more on the retail sector which is higher across the board. hereby's a conundrum for all of you investors. if we drill more, wouldn't that make inventories that are already high go even higher and potentially hurt prices? i have no idea but kate richard miechlt she's the ceo of warwick. nice to see you. >> nice to see you. >> as an oil and gas ceo, investing in the industry and living in oklahoma, what do you think of the donald trump win? >> it remains to be seen how it works out. his three are growth in job, energy independence which is
something that president obama has been very friendly to, in particular with repealing crude bans on exports in this country and lastly, clean air, clean water. it's been american energy dominance. >> kind of the -- pardon my french, screw opec view? >> yeah, but the question is in oil and gas demand and supply are pretty much balance d. if the use wants to grow supply, it's why we they're having the talk. from our standpoint in the industry, the epa has rules related to clean air and clean water. but we don't have a -- we haven't seen a decline in
drilling this this country because of epa regulations. we've seen a decline because of two years of low prices and there are a lot of places you can drill in this country that are not, you know, not being drilled because of epa regulations but because of low prices. i think there are some that need to be work it out. >> so if a lot of regulations are repealed to make it easier, wu what brings it online is simple. >> they're driven by two things. supply and demand and more importantly sentiment. at times when there is too much supply or not enough demand, those forces will outweigh. really the trump stuff is interesting. it's very interesting to parse. you can't put the whole story together in terms of energy policy. what's more important is natural gas and winter and opec, meaning at the end of november. both are bullish for the
economies. >> you're not aware it will spur economic growth which will spur demand for oil. >> i do name that. >> okay. >> infrastructure is very important. >> so much oil goes into asphalt. it's very bullish. some of the things -- >> you know what it does put an end to? remember they were going to do an skriez tax at $10 per barrel. the inventions that came out as part of the crazy stuff at minimum appears to go away at this point. >> yeah, but the idea that trump
is going to bring back the coal industry, i think that probably doesn't happen. that would be very negative for natural gas because they compete. i think it would be negative for the united states and the world. >> can i ask you a question that i know you're not going to answer but i'm going to answer anyway. you're neighbors if not friends with harold hamm. >> we're both oklahomans. >> do you think he would accept the energy job? >> i think it would be hard for him. >> hard to accept or back down. >> it would be hard to abandon. that company is his baby. it's rags to riches company. he built that company through blood, sweat, and tears. i don't know. he loves politics. he was instrumental to working with washington. he spends a lot of time in washington. the good thing for u.s. energy
independence and the country overall is there are a lot of people at this point who could step back from their companies and go to washington. >> because they have enough money. >> thanks, kate. all right. president-elect donald trump on capitol hill after meeting with president obama at the white house. there he takes in a view from the balcony on the west front of the capitol where he'll be swosh in on january 20th. his immediate task. looking for his administration looked like. he was white house press secretary in a republican administration and he was among a never trum per contingent. the nasdaq is lower today led by
battered t eed tech stocks. "power lunch" will be right back. ♪ approaching medicare eligibility? you may think you can put off checking out your medicare options until you're sixty-five, but now is a good time to get the ball rolling. keep in mind, medicare only covers about eighty percent of part b medical costs. the rest is up to you. that's where aarp medicare supplement insurance plans insured by unitedhealthcare insurance company come in.
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crazy story. we have the dow up nearly 200 points. we're well on our way to the best week of the year for dow, however, it's been the worst for some. nasdaq is down, amazon is down. we veal much more. oil closing. oil, not a big move, despite all the talk we had about this maybe more oil-friendly administration, crude oil down, 1.4%. let's get down to courtney reagan, whose family i got to meet. >> thank you very much for both of those, bryian. president-elect donald trump had a meeting with president obama afterward they discussed it. >> we discussed a lot, some wonderful, some difficulties. i very much look forward to dealing with the president in
the future including counsel. it was a great honor and i look forward to meeting with you many, many more times. they're going house to house searching for improvised explosive deviceses, this after capturing the town from isis militants. were helped in clears the explosives by personnel. >> prince charles and his wife camille shopped. they bought nesting dolls and a cushion. now back over to you, tyler. >> thank you very much. courtney. on to capitol hill where he met. our next guest knows those holds of power very, very well. we're pleased to welcome former white house press secretary ari
fleischer to "power lunch." welcome back. >> good to be here. >> you were not, let us say, supporter of mr. trump or mrs. clinton. but be that as it may, he's the president-elect. what do you think he needs do? >> he needs to be an outsider. that means the economy first, jobs first, immigration, and the repeal of obamacare. that's what he's got to focus on first because if he starts to tack too much to the washington bipartisan way that a lot of people hope and want him to run to, he will neglect his base and you cannot do that as first year president. >> how does that advice translate into selection for his candidates. does he need fewer people with washington experience, any people with washington experience? who and what? >> you always need a mix.
he's an outsider but he's a unique outsider because he ran to change washington. what i say as an establishment insider republican type, he needs mostly outsiders. he does not need the experienced people who have been there before as much as he needs people who are dedicated to changing america as donald trump promised do. i think that defies conventional wisdom but he's got to be true to what he says he'll be. >> do any outsiders come to mind who would be suitable for treasury, for example for the state department or defense. do you have people buzzing inside your head? >> i learned a long time ago not to guess. the only person who knows is the president and the president election and the small group of people around him because they don't talk.
the whole speculation thing drives me crazy. they'll say i heard it by so and so. mentioned by whom. >> would you take a job in a donald trump white house. >> i would not with anyone. i did it happily for 21 years. it was fantastic. i knew my time had come. i love being bg in the private sector. that's a no, but that would be true for everybody. i was happy to do it for george w. bush. >> who would be a good press secretary? >> he'd better pick somebody with really thick skin who likes to be treated like a human pinata every day. >> which is true regardless of whichever president is in the white house. >> exactly. it's the brutal job, the best job you'll ever have. i loved being press secretary. you have to pick someone who
knows you well. it's invaluable. that's what makes him an effective staffer. >> all right. i've got a lot of friends in that corps? has anybody built that kind of relationship? it was a pretty testy shall we say relationship during the campaign? >> no, i think several people at the top layer did build that relationship with donald trump and they were effective. they won. so he does have a small cadre, a team, a team of loyaltyists and that's what a team needs. >> let's talk about the way he goes about bringing about some of the change he talked about on obamacare, on taxes. some things he can do on his own. most things he can't. how does he navigate washington? >> well, he's going to have to be very effective with the congress and he's going to have
to be patient. these things take time. george bush's focus was on the economy. it took to memorial day, three or four months to get that done. nothing happens quickly in washington. that's the way our constitution is set up. he's going to have to do a good job of delegating, to conal, the senate majority leader, to speaker ryan, the speaker of the house and he's going to have to be cajoling. you know how you convince congressmen? you have their votes in their home district and scare them. his popularity is the most important thing to help him pass his agenda. >> ari fleischer, thank you very much. we appreciate your time. >> thank you. >> "power lunch" returns right after this. hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal.
>> there he is. that's the coach, tyronn lue. apparently the jersey was presented by kevin love, one of the stars of the team. >> all right. a big rally on wall street. now on dow, 19,000. bob pisani joins us from the floor. big gain for dow, not so much for the s&p 500. >> no. take a look at the sectors today. a continuation of the trends we have seen before. less regulations from the banks, growths and industrials and the materials. statements lagging and telecom. here's the lagging we've been talking about. a number of ways you can do it. reflags is a word everyone is using into the reflags. energy, materials, industrials, and banks.
all the school growth names. financials, energies, industrials. there's a way to construct this. hcsb. look at it outperforming the last few days. low volatility, that's consumer staples, the orange one, underperforming. you can play this using an etf. they're all trading up. macy's and kohl's have had confidence. they've got a new deal with brookfield, kohl's ceo kevin manziel where they continue to see continued improvement. >> talking positive for the holiday season. but, remember, same sore sales still down. sitting right behind you for the day, back to you. >> bob pisani, thank you. two sectors rallying over the
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nation." since the financial crisis, many names up 20%, 30% in the past 90 days. how much of this is the change in the yield on bonds which maybe makes banks' balance sheets more attractive or in your trading view a sector rotation from tech to banks? >> well, like many things in the market, it's a combination of that and also, of course, fewer regulations that people are looking for or anticipating from the trump administration. the one thing, though, as you mention, the group is up incredibly in the last three months and it's getting very extended. i, to be honest with you, am no a believer of chasing. maybe it's because the bond market is getting incredibly oversold and incredibly overhated. the futures are only 6% bold.
that's very, very low. that's getting very rife for a bounce in price and the yields are down. that will give the people the excuse to take this overbought group and pull back a little bit. again, that sentiment is something that usually leads to a multi-week bounce, a week or two. it's more than day or two of a bout. so i think it will be a better opportunity to buy it in the coming week or two. >> okay. making a bit of a cautious tone there. i don't know if a lot of people know this, but morgan stanley shares have almost doubled. it's doubled since its february low. what is your take on the banks and financials? >> i mean people have been talking about it all day, about the raising yield that will help out the banks and there's a legitimate case for that and a case for heightened economic activity. i don't know where thoughts were two or three days ago. the one that scares me is
everybody thinks there's going to be less regulation on the banks going forward. doing see that. even if they were to repeal dodd/frank tomorrow, for the banks to get back in motion, they spent the last eight years growing out their proprietary departments. the best way to play this is with options. i'm obviously biased. if you own these banks, if you were fortunate to call this all right, buy some puts against your positions. go out and spend 30 increments on some year-end 21 puts just to get yourself hedged. it's really a long stretch right now in the financials? >> a dual note of cautions. dennis, matt, thank you very much. for more, go to our website. we're back in two minutes.
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. a big rally for retail. the retail on for 3% being led by kohl's up 11% after reporting earni earnings. he just raised the price target for kohl's from 38 to 52 upped price target for macy's to 45 bucks. part of the price a little behind on price targets so not seeing incredible amount of upside. what leads you to be more optimistic? >> this was the week that people were concerned about in retail. the department stores is where
there was the most negativity. next week you get sporting goods retailers. this was the real week of concern. the department stores so far have delivered. more so it is optimism looking forward. you have easier compares and i think people are looking ahead to 2017 more so on the traffic aspect then maybe we can see more optimism. >> how does the election factor into this? we had some data points from those who said in july that the election caused uncertainty so the most recent conference call. starbucks is in a lot of malls that these retailers are in. are you expecting thad to play a role in terms of the third and fourth quarter? >> no question that some of the uncertainty held the consumer back. it is hard to parse through the noise. we had really bad weather in the third quarter. it was much warmer year over
year. that was an aspect. i'm sure there was overhang. i think some of that probably will continue into the early part of the fourth quarter but you have holiday and i think people are going to put presents under the tree. i think it will be interesting to see if we do see more of a sense of certainty. it could turn out to be better of a holiday than maybe initially thought. >> let's say i call you up and say now that donald trump is president-elect how does that shape your view of the retail sector in the next six months? >> that is something we are working on in the next couple of months. >> not an initial guess. this is not something you looked at it. >> we looked at it. i think tax rates is part of it both for the corporates as well as for the consumer. it all comes down a certainty versus uncertainty. i think this has been a hard-fought battle into this election.
there is no question about it that i think a lot of the back and forth has created more of an air of uncertainty. if that clears potentially a consumer to look at is the aspirational consumer. so that upper end, that upper tier. if you see continued gains in the stock market you are going to be lap smg of the tourism head winds in addition to oil and gas weakness all of this combined, those are all tail winds into 2017 that could piece together for a pretty good setup. >> thanks. >> thanks for having me. check please is next. with directv and at&t you can stream your favorite shows without using your data. that makes you more powerful than being stuck in an elevator with a guy with overactive sweat glands. sorry, rode my bike today. cool. hey it's your tv, take it with you. watch all your live directv channels, on at&t, data-free.
ally. do it right. check please. >> certainly an iconic moment from today was this one. donald trump being shown the steps of the capitol. do we have this video? by house speaker paul ryan. >> get used to it, folks. >> did we ever think we would ever see this day? i know a lot of his voters did. >> you did. >> i did. but that's for another segment. >> never seen you guys so quiet over there. >> it was an incredible video. >> i'm so sorry. these are the cadets from the u.s. military academy. a round of applause in the room for all of our cadets, ladies
and gentlemen. lieutenant of the u.s. navy. how did you get here? >> special guest. >> special guest of one of our desk managers. serving america, the only thing i have in common with them is a gray suit. >> why are they here? >> just doing a tour? >> you can speak. >> part of the investment club. >> i didn't know that. what do you like right now? >> what stocks? >> what stocks? >> i'm just a plebe. >> investment club, what do you think of the market here? it's great, right? >> it's good. >> tyler, i want them on the record. will they beat navy in baltimore on december 10? >> now you got them going. it's going to be a very good game this year. both teams are very good this year. who is going to win?
>> the navy. >> thank you very much. >> of course, we are on dow 19 watch as we did cross into record territory. keep a watch on s&p. thanks for watching power lunch. "closing bell" starts right now. >> the dow is hitting record levels. we are on track to close at an all-time high has donald trump meets with president obama and congressional leadership. we look at why the nasdaq is declining. it's not participating even as the dow